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Qantas has settled a class action case brought by customers who paid for flights cancelled during COVID, agreeing to pay $105 million.
The settlement, subject to the approval of the Federal Court, will see the airline pay $105 million to affected customers.
The class action stems from Qantas flights scheduled to depart between 1 January 2020 and 1 November 2022 that were cancelled by airline as COVID halted the aviation sector.
Ticket holders alleged the airline breached its contractual obligations regarding refunds. Under the terms of the settlement, the agreement will make no admission of liability.
In August 2023, Qantas gave customers restricted flight credits instead of cash refunds. As COVID shutdown aviation, passengers would be in no position to use refunds, which themselves were due to expire.
The treatment of customers sparked outrage for the airline at the time. Alan Joyce stepped down as CEO the next month, after the storm of outrage engulfed the airline.
“This is a very significant financial settlement which will see compensation put into the hands of hundreds of thousands of Qantas customers,” said Andrew Paull, Partner at Echo Law, which brought the suit.
“We’re very pleased to have been able to achieve this result.”
This class action was based on allegations that Qantas customers were contractually entitled to cash refunds when their flights were cancelled due to COVID travel restrictions, he said. “Instead of those refunds, Qantas customers were issued with restricted flight credits.”
The settlement sum is in addition to Qantas’ public commitment, provided in August 2023, to provide refunds to all COVID credit holders.
Under the settlement, eligible customers can now seek “compensation in addition to any existing refund rights.”
It follows a separate case, in May 2024, when Qantas admitted to the Australian Consumer and Competition Commission it had advertised and sold tickets on already cancelled flights to tens of thousands of consumers.
The so-called “ghost flights” resulted in Qantas paying $120 million in penalties and compensation.
More to come
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